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Almost one-third of US homeowners who bought in the last five years now owe more on their mortgages than their properties are worth, according to Zillow.com, an internet provider of home valuations.

Second-quarter home prices fell 9.9pc from a year earlier, giving 29pc of owners negative equity, said Zillow, the Seattle-based service that offers values for more than 80 million homes. For those who bought at the 2006 peak of the housing market, 45pc are now underwater, Zillow said.

Negative equity and declining prices are making it difficult for homeowners to sell property for a profit. Almost one-quarter of US homes sold in the past year were for a loss, Zillow said.

That contributes to the foreclosure rate because some homeowners can't absorb the loss and end up surrendering their homes to the bank that holds the mortgage, said Stan Humphries, Zillow's vice president of data and analytics.

"For homeowners who need to sell, this is a gravely serious situation," Humphries said.

"It can also be harmful to communities where the number of unsold homes adds more to inventory and puts downward pressure on prices.''

The highest percentages of homeowners with negative equity were located in California. In four of the state's metropolitan areas -- Stockton, Modesto, Merced and Vallejo-Fairfield -- the number of homeowners whose mortgage debts exceeded the values of their properties topped 90pc, Zillow said.

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